The Daily times. [volume] (Richmond, Va.) 1886-1889, 1887-07-08
VIRGlNlA'S DEBT.
a Plain Statement of the Facts in the
WALTER WHEREBY.
[specIal Corre1ponlenccl

/ \ Pain Statement al inc raw. III wv
Case.
Especial Corre1pondenccl
WASHINGTON, July .. - Sir Edward
| Thornton. formerly British minister 10 the
/ United States, and very recently financial
minister from the British bondholdciS 10 tho
state Of Virginia, has gone homo ia rather
bad humor after pointedly in:imaimg that
he would make the state debt of Virginia an
international question. There is only lare
possibility that the United States viii take
any action regarding the debt Of u state, for
getting in debt and paying, or failing to pay,
is one Of the few functions on which all pohti.
cal parties have agreed 10 the most extreme
doctrine If states rights: but as the division
of old Virginia during the war put the debt
Of that state on somewhat different footing
from that Of other states, and az least one
prominent statesman advocates national as
sistance 10 that state, it is we'll worth our while
to lool, into the facts. Tho following figures
are taken from the state auditors books at
Richmond:
Jan. /, 1861, Virginia then including the
present West virginia. owed SG..iS.lH;
nine years afterward her debt. floating and
bonded, was Slj .GGO3ls And none Of this,
strictly speaking. was incurred for wan pur-
pOses: much Of IL was merely accumulated
interest and the rest for expenses incurred
after the surrender Of Lee and before the re-
turn Of prosperity and full revenues. Tho
original debt was validity contracted I'm con-
structing valuable Improvements, but as there
had been some extravaganza between 1865
and 1870, and as West Virginia had with
drawn with her share Of the improvements,
q question arose as 10 how much the old state
honestly owed. Virginia, therefore, agreed
% assume two-thirtls OF the debt MS 10 stood
in 1870 and the funding act Of March 80
1871, into thirtyfour year bonds bearing Is
per cent. interest, coupons receivable for all
debts and demands due the state The
b0ndhoiors FASTENED 20 refund on this basis,
and nearly twO-thiris Of the amount assumed
had been funded when, on March Z, 1872. the
legislature reported the clause making the
coupons legal tender 10 the state for taxes
The claim was made that payment i'm coupons
would so far reduce the states cash receipts
as 10 close the public schools. and ON this
ground the colOred voters unanimously. many
whites with them, supported the policy Of
coupon repeal The bondhollers could neither
sell nor collect on their coupons for some
years: so on March 2S, 1879. the legislature
passed the "ten-forty act, to the effect that
the matured coupons might bee refunded at
half their face, and the other bonds c0n.Oli-
dated-those taks under the act Of March
30. 1871, at reduced rates-into new bonds
bearing 3per cent. for ten years, per cent
FOR the next twenty years and per cent for
ten years, the coupons 30 be again receivable
for taxes. This is the noted "Riddcberger
act" drawn 10y the senator Of that name
The bondhoders generally refused this offer,
aud when some 100000 had been re-
funded under it, the legislature, I'm Feb
ruary, lss2, and November, 1881, again
changed the terms scaled down"
small part OF the debt and again pro-
vided for funding the remainder. adding "a
stringent clause that those who did not refund
under this act before "a certain date should be-
without IA remedy. The bondholleIs then
made a test case on tho coupons in the
Federal courts, and the supreme court Of the
United States decided, five Justices 70 four.
that officials must receive the coupons for all
taxes and demands due the state The four
dissenting judges held that the Federal court
had no jurisdiction, as the Eleventh amend
ment % the constitution forbade il TO net in
such cases, 80 the decision is liable 90 be- over
ruled az any time after a successor is ap-
pointed b the late Justice Woods And in
this curious, uncertain and unsatisfactory
condition the matter stood when Sir Edward
Thornton arrived. In the meantime coupons
have matured 10 the amount Of S2,JOO,OO0
nearly-cnough 10 keep all cash out Of the
q.
ians as yet have not ayaiei themselves very
largely Of this cheap way Of paying taxes.
The total Of Virginias property as5ess-
ment IN 1855 was S3i7, 7C7, 7Gj, and the tax
for state purposes forty cents on the 500: but
il is evident that the real value is more than
twice the assessment Moreover the tendency
in Virginia, as in many other places at pres
emit, i, 20 lay nearly all taxes on land. for Of
the above total assessment only Ss4,sl 0G7
was on personals, and as there are at least
100000 people IN the state this would be less
than $50 per capita IN personals, a self evil
dent absurdity. Since the decision the state
has sought 20 protect itself la various ways
against a food Of coupons into the treasury;
but il is now believed Tor at any rate hoped
in virginia. that when the new justice Is APP
pointed the supreme court OF the United
States will be five 10 four the other way
And this is indeed almost certain 10 be the
case. Such was the condition when Sir Ed
ward Thornton appealed 10 the state, and
such it remains; so there is much talk ~ an
appeal to the British government % DO some
thing at Washington. Great Britain has en-
forced the rights Of her bonlholders in Peru,
Egypt and elsewhere, but that sort Of a per
Torrance would not do here Negotiation
and discussion may induce the general gov
eminent 10 help Virginia, and then again,
and more likely, they may not
J. b. PARKE.